Gareth Hatch of Technology Metals Research published an article this past weekend on his recent visit to Canada Carbon Inc.’s (TSXV:CCB) Miller graphite project.

In it, he explains what work has been done on the project since February 2013, noting that “trenching work [has] identified a number of graphite veins and pods throughout the property.” He states:

The graphite can be found alone or associated with minerals such as wollastonite and pyroxene. It has also been found in disseminated form in marble and sulphide-bearing paragneiss, but the veins and pods are of primary interest because of their high grade and potential purity. [Project geologist Steven] Lauzier indicated that veins with grades of 40-80% carbon as graphite (Cg) and pods with grades of 10-15% Cg are common on the property.

According to Lauzier, “the graphite veins are likely the result of the transportation of carbon in hydrothermal fluids, which were channeled up through fractures in the rock over time. As the fluids cooled to 700-800 °C, the graphite was precipitated in large, highly crystalline flakes.” That, said Hatch, is significant because:

The formation of hydrothermal veins leads to the presence of very high-purity graphite and such occurrences are rare. The only current source in commercial quantities is the island of Sri Lanka. Once extracted, the graphite is relatively easy to process. The high degree of crystallinity in vein graphite (as a result of the way that it was formed), leads to thermal and electrical properties that are superior to the more typical natural-flake graphite, which forms from carbonaceous sedimentary deposits under heat and pressure. The most interesting and potentially lucrative applications for hydrothermal graphite materials, however, are in the nuclear industry.

Those veins are a plus for Miller in that they make the property “highly prospective for the production of nuclear-grade graphite.” However, “they also make it a real challenge to be able to produce a traditional mineral-resource estimate.” Hatch notes:

Such estimates are typically derived from drilled samples taken across a project, with the mineral content found within the cores used to establish a 3D model of the geology of the deposit. This is fine in a deposit where the graphite or mineral of interest is disseminated spatially in the host rock; but when graphite occurs in highly concentrated veins and pods, drill results are likely to be ‘hit or miss’, with mostly ‘miss’.

In closing, Hatch details the responses he got from Bruce Duncan, executive chairman and CEO of Canada Carbon, regarding those concerns. He concludes:

The Miller property is clearly an unusual and possibly unique graphite project; and given the indications that lump / vein graphite sources in Sri Lanka are diminishing, a hydrothermal lump / vein deposit in North America would be highly attractive to numerous end users. The key challenge for the project will be to be able to put in place a financing structure that will allow the project to go into commercialization, without the benefit of establishing a minimum level of confidence in the size of the resource present, using the usual means of reporting. Nevertheless, if strategic and other partners can be persuaded to work with Canada Carbon on the basis of the excellent metallurgical results obtained to date, the project has a good chance of going into operation.

Click here to read the full Technology Metals Research report.